Tuesday, December 21, 2004

Tuesday Close

S&P 500 1,205.45 +.90%
NASDAQ 2,150.91 +1.08%


Leading Sectors
Airlines +2.83%
Broadcasting +2.48%
Gaming +1.96%

Lagging Sectors
Homebuilders +.28%
Papers +.26%
Defense -.03%

Other
Crude Oil 45.70 -.13%
Natural Gas 6.93 +1.02%
Gold 442.90 unch.
Base Metals 121.73 +.94%
U.S. Dollar 81.97 +.04%
10-Yr. T-note Yield 4.17% unch.
VIX 11.55 -2.37%
Put/Call .80 -13.98%
NYSE Arms .68 -35.24%

After-hours Movers
RENT +18.5% after saying Mark Cuban bought 500,000 shares of it for $4.5M.
INTV +5.4% after beating 3Q estimates substantially.
RIMM -4.1% on profit-taking after beating 3Q estimates and reiterated 4Q outlook.
SLR -6.5% after missing 1Q estimates and lowering 2Q guidance.
MERX -15.3% after missing 2Q estimates and lowering 3Q guidance.

Recommendations
Goldman Sachs reiterated Underperform on BSC and UAL.

After-hours News
U.S. stocks finished higher today as the DJIA reached its highest level in 3 ½ years on short-covering and year-end positioning. After the close, Sony Corp. found parts for its PlayStation game consoles were being assembled in a Chinese prison during a five-year investigation to combat large-scale piracy, the Financial Times reported. Japan Airlines, the country's largest carrier, may buy as many as 58 Boeing airplanes to replace older planes in its fleet, the Wall Street Journal reported. Fannie Mae's board accepted the resignations of CEO Raines and CFO Howard, Market News reported. Importing drugs from Canada and other nations where prices are lower wouldn't generate enough savings for US consumers to justify the risks, regulatory costs or harm to the drug industry, a federal task force found. Research In Motion said third-quarter profit rose to $90.4 million and sales surges as it enlisted mobile-phone service providers in Europe and Asia to offer its products, Bloomberg reported. Nintendo boosted its shipment forecast for its new console amid high demand in the US and Japan, Bloomberg said. Qualcomm raised its fiscal first-quarter profit forecast amid rising demand for handsets that deliver Internet access and take photos, Bloomberg reported. Japanese export growth accelerated to 13.4% in November, easing concern overseas demand for goods made in the world's second-largest economy is faltering, Bloomberg said.

BOTTOM LINE: The Portfolio finished slightly higher today on gains in my semi equip., software and biotech longs. I added a few new longs from various sectors in the afternoon, bringing the Portfolio's market exposure to 125% net long. One of my new positions is SIMG and I am using a $16 stop-loss on this long. The tone of the market improved throughout the afternoon as most sectors rose, the advance/decline line finished near its daily highs and volume was healthy. Measures of investor anxiety fell again. The VIX is now near levels last seen in 1995. This is likely a result of the fact that the overall market appears the healthiest to me since 1995.

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